Housing Recovery Firmly In Motion

     Throughout the past few months I have been discussing how we got into this housing mess, what needs to happen for a recovery, and then following the progress of our housing market. If there was any doubt of our country being in a true and consistent housing recovery, it should now be abandoned. Kiplinger, a well-known and respected financial reporting and forecasting firm, has stated that the housing recovery is "firmly" underway. One of the main reasons for this statement is the fact that home prices are consistently rising and inventories are consistently diminishing. This is a good indication of a housing recover because we are seeing the prices rise along with the buyers' ability and willingness to dish out those higher prices in turn leading to a lower inventory. On top of that great news, Kiplinger also states that the housing recovery will help to carry the overall economy at a time when US exports are decreasing.

“The biggest reason we think we’re on firm ground is that we’re seeing every indicator on the way up,” says Karen Mracek (A Kiplinger editor and real estate analyst). “As with the overall economy, it’s kind of hard to call the bottom or the pivot point. But we’re seeing a range of indicators that suggest pretty solid growth going forward.”

     Aside from the rising home prices and supply of homes there are other indicators that point to a strong and sturdy recovery. These include multiple-bids on homes, increased new-home construction, and credit availability. If these fundamental aspects can continue their great progress we will see more borrowers come out from underwater along with new jobs in the real estate and construction industries.

     Although the improvements have been, and will continue to be un-even across the country with a slower turn-around in the Florida Metropolitan areas and the mid-west, the changes are still continuing to take place and this country's housing marketing is moving firmly in the right direction. For our country overall, Mracek says that the current housing recovery is real and sustainable, but she also points out that the rise in home prices and decline in inventories will not maintain its current pace.

“We see prices leveling out a bit more [in the future] from the late jumps in 2012,” she says. “There are still foreclosures for the banks to work through. As prices improve, you’re going to see banks get rid of REOs.”